Ed Miliband’s department risks a war of words with Donald Trump after flatly refusing his call to “open up the North Sea”.
The US President yesterday urged Sir Keir Starmer to exploit the oil and gas reserves off our shores.
The call came amid soaring oil prices as the conflict in Iran continues.
However, issuing fresh licences to explore potential oil fields would “not take a penny off bills . . . and will only accelerate the worsening climate crisis”, the Department of Energy Security & Net Zero [DESNZ] insisted.
Mr Trump has repeatedly called for more North Sea oil to be recovered, previously urging the UK: “They’re sitting on top of the North Sea, one of the greatest reserves anywhere in the world, but they don’t use it”.
Asked on Monday what advice he would give the Prime Minister, President Trump replied that he should “open up the North Sea” and “stop people from coming in from foreign lands who hate you”.
Analysts have backed his demands, pointing out that the UK’s path to net zero includes the use of oil and gas up to 2050 and beyond.
“To shut down something we are still consuming makes no sense,” said Andy Mayer, energy analyst at the Institute of Economic Affairs.
Other commentators claimed that while following Mr Trump’s suggestion might not reduce household bills, it would reaffirm our position as a strong ally to America in an “unstable world”.
However, a spokesman for DESNZ flatly ruled out any fresh licences to explore new North Sea fields.
Ed Miliband’s department is rejecting calls to exploit the North Sea
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He said: “The UK benefits from strong and diverse security of energy supplies. “Issuing new licences to explore new fields will not take a penny off bills, cannot make us energy secure and will only accelerate the worsening climate crisis.”
The spokesman also rejected suggestions that fracking could be permitted in the UK, adding: “We intend to ban fracking for good and make Britain a clean energy superpower to protect current and future generations.”
Fuel prices have spiked since the bombing of Iran began on Saturday, and Iran’s de facto closure of the critical Strait of Hormuz has placed them in further jeopardy.
Gas prices climbed by 32 per cent overnight, one of the highest levels markets have seen in nearly three years.
Meanwhile, Qatar has decided to halt the production of liquified natural gas, despite supplying 20 per cent of LNG worldwide.
The UK previously shipped in 40 per cent of its LNG from Qatar, although this has now fallen, with most imports coming from the US and Norway.
The North Sea could help prove the UK is a reliable ally of the US, commentators have claimed
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But the turmoil in the Middle East has rocked the markets and experts predict sharp rises in petrol and energy costs.
Some estimates see UK household bills rising to £2,500 a year, a similar jump to those witnessed in the aftermath of Russia’s invasion of Ukraine.
Because North Sea oil and gas is sold on the international market, experts agree that more drilling would not result in dramatically lower household bills.
Simon Francis, coordinator of the End Fuel Poverty Coalition, argued that the best way to become immune to price shocks was to focus on homegrown renewable energy.
He said: “As long as our energy bills remain dependent on gas, households will keep being hit by global price shocks.
“The most durable way to protect people is to cut demand through a nationwide insulation programme, invest in homegrown renewables and reform energy pricing so bills are no longer tied to volatile fossil fuel markets.”
Donald Trump is becoming increasingly critical of the UK
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However, Mr Mayer, of the Institute of Economic Affairs, disagreed. He said President Trump was right in his call to expand North Sea exploration.
Mr Mayer also said that while the move may not bring down household bills, it was “plainly related to security and supply” and argued that a fixation on net zero was leading to the wrong choices being made.
Because gas and oil will still be needed by 2050 under the Government’s net zero plans, he said it was “nuts” to ignore domestic supplies.
Mr Mayer added: “President Trump is right. The approach to the North Sea by both this government and the last has been led by net zero.
“But to shut down something we are still consuming makes no sense. In all of the scenarios, there will be a need for oil and gas until at least the 2050s.
“Where Ed Miliband is right is that it’s not a price consideration, per se. But it’s plainly related to security and supply, particularly when we have an adverse supply shock like the one we are experiencing this week.
Households risk facing energy bills of £2,500
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GETTY“We don’t have gas storage reserves because we have always had the North Sea. We could rely on it coming through the network.
“The UK has pursued the fantasy that we can replace the whole lot with a renewable system, and that’s nuts.
“If we had spent the last 15 years building lots and lots of nuclear power stations they would be correct, but we haven’t.”
Andrew Montford, director of Net Zero Watch, argued that exploiting the North Sea would boost British industry and make us a stronger ally to the US.
He said: “Trump is right in a geo-political context. The world is very unstable and increasingly so. The US wants us to be strong because we are an ally.
“Wars are won by people with the industrial capacity to support a war. We don’t have that industrial capacity.
Smoke rises from a fire, as the Israel-Iran air war continues, in Tehran, Iran | REUTERS
“Trump is right and we need to reinvigorate the North Sea, and probably look again at fracking, as a first step towards re-industrialisation and getting hard power again. We are terribly, terribly exposed.”
Irish Taoiseach Micheal Martin has said he did not expect to see his country’s fuel prices rises because Irish oil “is coming from the North Sea and we don’t want any price gouging going on”.
He added: “Given the fact that people have an adequacy of supplies right now and given that a lot of our oil is coming from North Sea, which comes from Norway, there shouldn’t be these kind of increases that people have been commenting on yesterday.”
The US and Israel have continued with a barrage of strikes against Iran since killing its Supreme Leader, Ayatollah Ali Khamenei, on Saturday.